Microsoft upgraded after earnings; shares rise premarket

NEW YORK (MarketWatch) -- Shares of Microsoft
MSFT, -0.71%
rose 2.3% in premarket trade after Pacific Crest upgraded the software giant, citing increased clarity on the company's cloud strategy. Analyst Brendan Barnicle raised his rating to outperform from sector perform. He sees potential for the stock to rise 20% from Tuesday's closing price of $44.83 to his price target of $54. The upgrade comes after Microsoft reported mixed fiscal fourth-quarter results late Tuesday, in which profit missed estimates but sales beat. Barnicle noted that Microsoft's cloud business accelerated from the previous quarter as the company benefited from increased adoption of its Azure and Office 365 offerings. "We are becoming more constructive on MSFT as the company starts to provide more compelling evidence of its move to the cloud," Barnicle wrote in a note to clients.

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